Posted at 9:58 am on 02/12/2013 by Dr. Rahul Razdan, CEO Ocoos
In nearly all aspects of the business enterprise, fortune 500 companies easily partner with companies in the small and medium business sector (SMB) to build an overall solution. However, marketing and more specifically internet marketing remains an area where cooperation is very limited. This article makes the case that there are two reasons for this gulf. First, the proliferation of web development toolkits has created a level of mass customization of websites where cooperation is nearly impossible (http://www.ocoos.com/me/ocooscom/blog/web-development-toolkits-the-road-to-a-dead-end-54) at a technological level. Second, there is a lack of tools which enable cooperation and respect collaboration processes. With the existence of these tools/processes, a new level of capability can be unleashed for the mutual benefit of all parties.
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Fortune 500 companies use SMB partners in areas such as development, manufacturing, G&A, and sales. There are typically three reasons for this partnership: cost, access to unique skills, or unique access to customers. In all these areas, the fortune 500 company integrates its partners through the combination of software tools and processes. For example, the R&D function uses tools such as Product Lifecycle Management (PLM) integrated with professional product management to help fortune 500 companies integrate the global development task across a range of suppliers. Similar tools/methods exist in areas ranging from distribution, manufacturing or outsourced non-critical G&A functions. However, internet marketing remains stubbornly resistant to collaboration.
If successful, the companies who are able to use the tools/process to engage the marketing function can gain a disruptive value and competitive differentiation The most prominent (yet rare) example of a company employing this strategy is Apple with its platforms for itunes/appstore. With these platforms, Apple:
- provides software which allows for the integration of suppliers while maintaining a unified customer experience
- provides the processes for collaboration
- does not own the largely SMB businesses who participate in the system
As a result, Apple raises the value of its platforms, provides a commerce source for partners (especially SMB), and generates significant competitive differentiation.With software and associated processes, a whole host of industries can benefit from similar collaboration. Examples include:
- Large Hotel Brands: One can imagine large hotel brands integrating complementary services surrounding their hotels into a similar framework. With this capability, hotels could build "virtual" resorts without the need to own all aspects of the eco-system, and with much greater capability for their customers.
- Large Office SuperStores: Companies such as Staples/BestBuy could increase their value statement to include a broader array of SMB services ranging from accounting to facilities management.
- Auto Suppliers: These companies could integrate not only product, but complementary services (customization, repair, etc) to build a compelling solution for the customer.
At Ocoos, we believe that the integration of the SMB and fortune 500 world is perhaps the most powerful manner to drive synergy and generate commerce. As we explain in our white paper (http://www.ocoos.com/me/ocooscom/blog/the-internet-is-there-a-way-it-can-actually-generate-jobs-61), the integration of these worlds with internet marketing technology has the potential to materially reshape the landscape in a fundamental manner for commerce as well as employment.